Fuhu

Designer and seller of cloud-served softwares

Description

Fuhu Inc. is most famously associated with the Nabi series of Tablets. Among the first product they came up with was urFooz which were digital trading cards, urDrive a software that permitted devices to install and run the applications straight from a USB device, and Fooz Kids a mobile device platform which was a safe browser for kids that enabled access to only selected areas of the internet. The Nabi series of red padded tablets for kids, however, is their signature product.

Stats

Category

Software and Hardware

Country

United States

Started

In 2006

Closed

By 2015

Number of Founders

Three

Name of Founders

John Hui, Robb Fujioka, Steve Hui

Number of Employees

Between 501 And 1000

Number of Funding Rounds

5

Total Funding Amount

$66.2M

Number of Investors

8

Precise Cause of Failure

Mismanagement of Funds

Business Outcome

Acquired

Cause of Failure

Fuhu went bankrupt, even
though it ranked 1st on the Inc 500 companies list for two years in a row.

The company amassed an
enormous amount of debt and had a very high burn rate. The level of disregard
for any type of financial management was so high that the firm had only one
accountant and one bookkeeper despite its 300+ employees.

Fuhu had one good idea
which brought them to the top, but could never replicate it and kept borrowing
money in the millions from various companies with the hope that they will be
able to produce the next Nabi and break even.

In particular, Fuhu owed
Foxconn, a Chinese hardware manufacturer, between $60 million to $110 million.
The Chinese giant had previously already demanded from Fuhu to restrict its
operations costs but little was done on that front. Suddenly the company just
decided to stop backing up Fuhu and everything fell apart for the private U.S.
based company.

Later, Mattel purchased
Fuhu’s assets for just $21.5 million. Fuhu’s CEO, Robb Fujioka, still hopes to
come back with alternative ideas that will revolutionize the world and seems to
have considered Fuhu’s faith as an experience every major entrepreneur faces at
some point of their career.

A big resource for entrepreneurs and startup owners, in which we have collected and analyzed why +100 big companies have failed. Learn from mistakes, and avoid being part of the 90% of businesses that fail.

Fuhu Inc. is most famously associated with the Nabi series of Tablets. Among the first product they came up with was urFooz which were digital trading cards, urDrive a software that permitted devices to install and run the applications straight from a USB device, and Fooz Kids a mobile device platform which was a safe browser for kids that enabled access to only selected areas of the internet. The Nabi series of red padded tablets for kids, however, is their signature product.

Cause of Failure

Fuhu went bankrupt, even
though it ranked 1st on the Inc 500 companies list for two years in a row.

The company amassed an
enormous amount of debt and had a very high burn rate. The level of disregard
for any type of financial management was so high that the firm had only one
accountant and one bookkeeper despite its 300+ employees.

Fuhu had one good idea
which brought them to the top, but could never replicate it and kept borrowing
money in the millions from various companies with the hope that they will be
able to produce the next Nabi and break even.

In particular, Fuhu owed
Foxconn, a Chinese hardware manufacturer, between $60 million to $110 million.
The Chinese giant had previously already demanded from Fuhu to restrict its
operations costs but little was done on that front. Suddenly the company just
decided to stop backing up Fuhu and everything fell apart for the private U.S.
based company.

Later, Mattel purchased
Fuhu’s assets for just $21.5 million. Fuhu’s CEO, Robb Fujioka, still hopes to
come back with alternative ideas that will revolutionize the world and seems to
have considered Fuhu’s faith as an experience every major entrepreneur faces at
some point of their career.